Biden Administration Targets Largest Oil-Producing Area In U.S.
Jordan Vonderhaar/Bloomberg via Getty Images

The Biden administration is targeting the largest oil-producing area in the United States: the Permian basin, located in western Texas and southeastern New Mexico.

The Environmental Protection Agency (EPA) is considering labeling parts of the Permian Basin as violating the ozone standards set by the federal government.

“EPA is now considering a discretionary redesignation for (portions of) these counties in New Mexico and Texas for the 2015 ozone NAAQS under Clean Air Act section 107(d)(3) based on current monitoring data and other air quality factors,” the Biden administration wrote.

If the EPA succeeds in its plan, new permitting requirements and scrutiny of drilling operations will ensue.

“The possible regulatory action adds yet another element of uncertainty to the oil industry, which is already facing an unknown future while being chastised for not investing more to produce more—whether that’s refining or drilling,” explains.

“Creating uncertainty on permitting and inserting unnecessary regulatory barriers will only negatively impact the production necessary to meet the needs of consumers,” Todd Staples, president of the Texas Oil and Gas Association, informed Bloomberg.

In July, the Permian Basin will produce roughly 60% of the oil barrels per day from of the seven most prolific U.S. basins, according to the Energy Information Administration (EIA); 5.316 million BPD out of a total of 8.901 million.

In June, the Permian Basin is expected to generate 5.232 million BPD; the second most prolific area is expected to produce 1.152 million BPD.

In May, despite the record high price of gas in the U.S., the Biden administration announced it was canceling the sale of a massive oil and gas lease location in Alaska that was pending before the Department of the Interior (DOI). Biden’s DOI also canceled two leases under consideration in the Gulf of Mexico area.

At the end of March, the White House, while blaming Russian President Vladimir Putin for the rise in gas prices, bragged that “The first part of the President’s plan is to immediately increase supply by doing everything we can to encourage domestic production now.”

Yet in May, the DOI killed the potential to drill for oil “in over 1 million acres in the Cook Inlet in Alaska,” informing CBS News that the cancellation stemmed from a “lack of industry interest in leasing in the area” for the decision to “not move forward.” The DOI killed the two leases under consideration in the Gulf of Mexico area because of “conflicting court rulings that impacted work on these proposed lease sales.”

“The Biden administration is poised to let the nationwide offshore drilling program expire next month without a new plan in place,” The Washington Post noted, adding, “Barring unexpected action, the current five-year offshore drilling program will lapse at the end of June. Interior cannot hold any new oil and gas lease sales until it has completed a replacement plan.”

American Petroleum Institute (API) senior vice president Frank Macchiarola called the Alaska cancellation “‘another example of the administration’s lack of commitment to oil and gas development in the U.S.,’” adding, “‘The President has spoken about the need for additional supplies in the market, but his administration has failed to take action to match that rhetoric.’”

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